Bangladesh Overtakes China in RMG Export Volume to EU Market

Bangladesh Overtakes China in RMG Export Volume to EU Market

The Ready-Made Garments (RMG) industry in Bangladesh has emerged as a cornerstone of the country’s economy, playing a pivotal role in driving economic growth, employment generation, and export earnings. With a rich history of development over the past few decades, the industry has transformed Bangladesh into one of the world’s leading RMG exporters. The success of this sector has not only elevated Bangladesh’s global economic standing but has also reshaped trade dynamics and provided valuable lessons for other developing economies.

Importance of RMG Exports for Bangladesh’s Economy

The RMG industry is the lifeblood of Bangladesh’s economy, contributing significantly to its GDP, export earnings, and employment. With millions of workers employed in thousands of factories across the country, the industry has been a key driver of social and economic development, particularly for women who constitute a substantial portion of the workforce. The revenue generated from RMG exports has been instrumental in funding critical infrastructure projects and social programs.

Significance of Overtaking China in RMG Export Volume to the EU Market

The recent achievement of Bangladesh in surpassing China in RMG export volume to the European Union (EU) market marks a historic turning point. This accomplishment not only reflects Bangladesh’s rapid growth and competitiveness but also signals a shift in the global supply chain. The implications of this milestone extend beyond economic metrics, indicating Bangladesh’s ability to adapt, innovate, and carve a unique niche in the global trade landscape. This content will delve into the factors underpinning this achievement, its implications for both Bangladesh and China and the lessons it holds for other economies seeking to make their mark on the international stage.

Bangladesh’s RMG Industry at a Glance

The roots of Bangladesh’s RMG industry can be traced back to the late 1970s when the country embarked on a journey to diversify its economy beyond traditional agricultural sectors. The sector started with a few small factories but rapidly expanded due to the competitive advantage offered by low labor costs and a large workforce.

What Factors Are Contributing to the Growth of the RMG Industry?

  1. Labor cost advantage: Bangladesh’s abundant labor force, coupled with comparatively low wages, provided a compelling incentive for international brands and manufacturers to set up operations in the country.
  2. Trade agreements and preferences: GSP (Generalized System of Preferences) status and trade agreements with key markets, including the EU, granted Bangladesh preferential access, boosting exports.
  3. Government policies and incentives: Supportive policies, such as simplified trade procedures and tax incentives, encouraged investment in the sector, fostering its growth.

China’s Dominance in RMG Exports to the EU

China’s ascent to the summit of the RMG industry was a result of a strategic blend of manufacturing prowess, infrastructure development, and market positioning. The country established itself as the world’s factory, with a massive manufacturing base capable of producing a wide array of clothing items.

What Are the Reasons for China’s Dominance?

  1. Early market entry and experience: China’s early foray into the global RMG market gave it a head start in building relationships with international buyers and understanding market demands.
  2. Manufacturing capabilities and infrastructure: China’s investment in technology, production efficiency, and infrastructure provided a formidable advantage, enabling large-scale production and timely delivery.
  3. Trade relationships with the EU: China’s strong trade ties with the EU, fostered through trade agreements and geographic proximity, contributed to its robust RMG export volume to the region.

Bangladesh’s Triumph: Overtaking China in RMG Exports to the EU

Statistical overview of Bangladesh’s RMG export volume to the EU Recent trade data reveals that Bangladesh has managed to exceed China’s RMG export volume to the EU market, marking a significant milestone in the industry’s history. This achievement reflects the culmination of years of concerted efforts to enhance production, quality, and compliance standards.

China’s loss of the top spot in RMG exports to the EU signals a changing competitive landscape. China’s response may involve a strategic shift toward higher-value products, technology integration, and expanding into emerging markets.

While Bangladesh’s achievement is laudable, challenges such as labor rights, sustainability, and global economic uncertainties remain. The country must continue to address these challenges to ensure sustainable growth.

Ensuring sustainable growth of Bangladesh’s RMG industry Sustainable practices, encompassing ethical labor standards, environmentally friendly processes, and responsible sourcing, are crucial for the industry’s long-term viability. Embracing innovation, automation, and technology can bolster production efficiency, product quality, and competitiveness, ensuring continued growth. Bangladesh’s success story can inspire other developing economies to harness their strengths and integrate into the global supply chain, potentially altering trade dynamics.

Factors Contributing to Bangladesh’s Overtaking of China

  1. Sustained growth and increased production: Bangladesh’s consistent growth in RMG exports was driven by its ability to adapt to market demands and deliver high-quality products at competitive prices.
  2. Compliance with international labor and safety standards: Improved labor conditions and adherence to international standards earned Bangladesh’s RMG industry a favorable reputation, enhancing its market access.
  3. Trade agreements with the EU: Trade agreements, such as Everything But Arms (EBA) initiative, provided Bangladesh with preferential access to the EU market, boosting its competitive advantage.
  4. Adaptation to changing consumer preferences: Bangladesh’s responsiveness to consumer trends, including sustainability and ethical concerns, enabled it to tailor its offerings to meet evolving demands.

Further Reading: Readymade Garment Industry (RMG) and World Markets: Everything You Should Know


Bangladesh’s achievement in surpassing China in RMG export volume to the EU market marks a pivotal moment for the country’s economy and the global apparel industry. This success is a testament to Bangladesh’s dedication to enhancing its manufacturing capabilities, competitive advantages, and strategic positioning. As the country continues to navigate challenges and opportunities, its role in the international RMG market is poised to further evolve, impacting trade dynamics and shaping the industry’s future landscape.